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Grayscale to forgo Ethereum PoW tokens; files for new ETH ETF



Grayscale, a leading cryptocurrency investment firm, has revealed its decision to relinquish all rights to the Ethereum tokens known as ETHPoW, which are associated with the post-merge proof-of-work (PoW) protocol. Effective from the record date of September 18, Grayscale permanently forfeited all rights to ETHPoW tokens on behalf of its shareholders.

Following a thorough evaluation, Grayscale determined that these tokens lacked sufficient liquidity and lacked support from the custodian of the products. As a result, they stated, “exercising the rights to acquire and sell the ETHPoW tokens was deemed impractical,” and on behalf of the shareholders as of the record date, Grayscale is renouncing these rights to the assets.

Grayscale’s decision to relinquish rights for ETHPoW tokens comes just over a year after the Ethereum Merge, which shook up the Ethereum ecosystem on September 15, 2022. This transformative event marked a clear shift from the traditional proof-of-work (PoW) to the proof-of-stake (PoS) consensus mechanism. As a result, the Ethereum blockchain underwent a division, paving the way for the main PoS-based Ether and the secondary PoW-based EthereumPoW (ETHW) tokens.

In contrast to Grayscale, some cryptocurrency investment firms, like ETC Group, attempted to introduce specialized exchange-traded products (ETPs) based on Ethereum’s Proof of Work (PoW) system. However, ETC Group decided to discontinue its PoW-based ZETW ETP just six weeks after its launch, citing a lack of suitable custody providers as the reason.

The news of Grayscale’s decision regarding ETHW came a day before they announced their intention to launch a new Ether (ETH) futures exchange-traded fund, with the ticker symbol ETH.

On September 19, the firm filed with the United States Securities and Exchange Commission to seek approval for listing and trading shares of the Grayscale Ethereum Futures Trust (ETH) ETF on the New York Stock Exchange under Arca Rule 8.200-E.


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